Pleased to share that one of my research papers on gender diverse boards was recently published in a highly reputed journal. The research paper is published in Journal of Business Ethics that is among Financial Times 50 journals.
Our research paper is entitled "Shhh...Do Gender-Diverse Boards Prioritize Product Market Concerns Over Capital Market Incentives?". I co-authored this research with Dr Dharmendra Naidu.
In this research, we find results suggesting that female directors foster ethical redaction of confidential information to protect a firm's competitive edge. Although this results in short term pain (adverse selection cost), firm benefits in the long term via shareholder wealth maximization! (Naidu and Ranjeeni, 2023).
Our research highlights that female directors foster ethical redaction of proprietary information and focus on long term shareholder wealth maximization.
Full Paper
The full research paper is Open Access and can be accessed for free using the following DOI: https://doi.org/10.1007/s10551-023-05553-3
Abstract
We examine whether gender-diverse boards prioritize product market concerns over capital market incentives when proprietary costs are high. We argue that gender-diverse boards protect their firm’s competitive edge and maximize long-term shareholder wealth by ethically and carefully maintaining the confidentiality of proprietary information. Due to the reduced disclosure of proprietary information, firms with gender-diverse boards are likely to face more adverse selection when proprietary costs are high. However, the reduced disclosure of proprietary information enables firms with gender-diverse boards to enhance and maintain their competitive edge and gain higher long-term returns. Using a matched sample of the United States-listed companies, we find that firms with gender-diverse boards, relative to similar firms with all-male boards, (1) are associated with higher adverse selection costs and (2) higher long-run stock returns when the firm faces high product market competition. Collectively, our results suggest that firms with gender-diverse boards, which initially experience higher adverse selection in a competitive environment, are rewarded with a net gain of about 10 percent of their stock price in three years. Our research contributes to the literature by highlighting the importance of board gender diversity in fostering the ethical redaction of proprietary information for proprietary cost-based motives as opposed to agency cost-based motives. Our findings have important implications for regulators, firms, and shareholders by identifying gender-diverse boards as an antecedent for the ethical redaction of proprietary information.
In the Media
Our research findings were also covered by Monash IMPACT and featured in Monash Alumni News. Please click the link below for more insights through Monash IMPACT website.
Reference:
Please appropriately cite our paper using the following reference:
Naidu, D., Ranjeeni, K. Shhh… Do Gender-Diverse Boards Prioritize Product Market Concerns Over Capital Market Incentives?. J Bus Ethics (2023). https://doi.org/10.1007/s10551-023-05553-3
Comments